Shares in Texas-based electric vehicle maker Tesla fell 28% since October 27, when its CEO Elon Musk acquired Twitter and appointed himself as “Chief Twit,” or CEO, of the social media company, according to CNBC.
Other major automakers’ shares
For comparison, other automakers such as General Motors, Ford, and Volkswagen have been slightly up since October 27, as is BYD, a Chinese company that makes EVs and batteries. While US electric truck maker Rivian fell by 27% over that period.
On Tuesday, Tesla shares closed at $160.95, down over 4% for the day. It was a rare exception amongst growth-oriented tech stocks, which mostly rose after cooler-than-anticipated inflation data was out early in the morning.
The decline in Tesla stock price has caused its largest retail shareholder Leo Koguan, a billionaire and IT services firm SHI International founder, to call for the company’s board to “perform shock therapy to resuscitate stock price,” that is, by way of a share buyback.
Musk sold billions of his Tesla holdings to finance the Twitter takeover
Previously, Musk has sold billions of dollars worth of his Tesla holdings to finance the Twitter acquisition. Since he took over the social media network, Musk regularly posts incendiary tweets, especially directed at people who hold center-to-left political values, and to some he often paints as rivals with a “woke mind virus.”
For instance, Musk aimed at the Director of the National Institute of Allergy and Infectious Diseases, Dr. Anthony Fauci, and trans people, tweeting that his pronouns are “Prosecute/Fauci.”
The tweet got more than 1 million “likes” on Twitter, where Musk has about 121 million listed followers. In addition, he received criticism from the White House and former CIA director John O. Brennan. White House press secretary Karine Jean-Pierre called the Tesla CEO’s tweets about Fauci “incredibly dangerous” personal attacks.
Tesla Cybertruck’s delayed mass production
Furthermore, Economic conditions and an aging product lineup also contributed to pressure on the company’s share price. The automaker has delayed mass production of its sci-fi-inspired, trapezoidal pickup truck, the Cybertruck.
Originally, Tesla showed off the Cybertruck design in 2019, when the company anticipated beginning production in 2021.
Nevada battery factory event
The manufacturer held an event at its Nevada battery factory to mark the beginning of deliveries of its all-electric, heavy-duty Semi truck in November.
At the event, Tesla executives, including Musk, did not mention self-driving tech, a price for the Semi, a million-mile warranty they previously teased, nor any expected production numbers.
Moreover, the carmaker is also facing backlash over the delay in delivering self-driving technology by software updates to its customers’ cars. Consumers are increasingly suing Tesla in the US to obtain refunds for self-driving systems they paid for and anticipated to be delivered already.
Driver assistance systems
The company markets its driver assistance systems as Autopilot, Enhanced Autopilot, and Full Self-Driving capability in the US. None of these make its cars safe to drive without a person behind the steering wheel, attentive to the road and driving task at all times.
Additionally, the California DMV investigates Tesla and has formally complained that it has engaged in false advertising on these systems.
Despite Musk’s new distraction with Twitter, several Tesla fans see the plunging stock price as a buying opportunity.
Notably, the company is scaling up production at a new vehicle assembly plant in Austin, Texas, and another outside of Berlin. The automaker has brought Shanghai Manufacturing leader Tom Zhu to the states to aid in maturing the Austin operation.
Elon Musk is no longer the world’s richest person
On top of that, Tesla’s troubles, which include supply shortages, production disruptions, growing raw material costs, and Musk’s preoccupation with turning around Twitter Inc., have all weighed on the stock. Musk has been dethroned as the world’s richest person due to the slide.
